Insights
IRS releases final 199A regulations for co-ops and their patrons
TAX ALERT |
Authored by RSM US LLP
The IRS has released final regulations regarding the application of the section 199A deduction to cooperatives and their patrons, as well as the application of the domestic production activities deduction to certain specified agricultural and horticultural cooperatives.
The final regulations generally adopt the proposed regulations, with certain modifications – including simplified reporting requirements, modifications to certain definitions, and simplified and clarified calculations and examples. Additionally, the final regulations remove the final and temporary regulations under former section 199 (governing the former domestic production activities deduction, or DPAD).
These final regulations will generally affect cooperatives and their patrons that are individuals, s corporations, trusts and estates.
The guidance will apply to tax years beginning after the date the final regulations are published in the Federal Register. However, taxpayers may rely on the final regulations before that date if they do so in their entirety. Alternatively, taxpayers may rely on the proposed regulations for taxable years beginning on or before the date, the final regulations are published in the Federal Register, provided they apply the proposed regulations in their entirety and in a consistent manner.
Let's Talk!
Call us at +1 213.873.1700, email us at solutions@vasquezcpa.com or fill out the form below and we'll contact you to discuss your specific situation.
This article was written by Ed Decker, Kyle Brown and originally appeared on 2021-01-14.
2020 RSM US LLP. All rights reserved.
https://rsmus.com/what-we-do/services/tax/federal-tax/irs-releases-final-199a-regulations-for-co-ops-and-their-patrons.html
The information contained herein is general in nature and based on authorities that are subject to change. RSM US LLP guarantees neither the accuracy nor completeness of any information and is not responsible for any errors or omissions, or for results obtained by others as a result of reliance upon such information. RSM US LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect information contained herein. This publication does not, and is not intended to, provide legal, tax or accounting advice, and readers should consult their tax advisors concerning the application of tax laws to their particular situations. This analysis is not tax advice and is not intended or written to be used, and cannot be used, for purposes of avoiding tax penalties that may be imposed on any taxpayer.
RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each is separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/about us for more information regarding RSM US LLP and RSM International. The RSM logo is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.
Vasquez & Company LLP is a proud member of the RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.
Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise and technical resources.
For more information on how Vasquez & Company LLP can assist you, please call +1 213.873.1700.
Subscribe to receive important updates from our Insights and Resources.